Theranos founder Elizabeth Holmes begins 11-year prison sentence

Theranos founder Elizabeth Holmes has started her 11-year prison sentence in Texas for defrauding investors out of millions, marking the end of one of the biggest scandals in Silicon Valley history.

Holmes, who was found guilty on four counts of fraud and conspiracy in 2022, entered the all-female minimum security prison in Bryan, Texas on Tuesday.

Earlier this month, a judge refused the mother-of-two’s request to remain free while she appeals her 11-year prison sentence for fraud. Holmes, 39, has argued that her original trial was unfair.

The disgraced tech founder’s arrival at the prison facility, which is around 100 miles northwest of Houston, is anticipated by inmates, the Wall Street Journal reported.

“Some people are like ‘I want to be her friend,’” the Wall Street Journal quoted Tasha Wade, a current inmate, as saying. “But other people are like, ‘I can’t believe that’s all she got for taking all that money,’” Wade said.

A copy of ‘Bad Blood’, the book charting the disgraced tech founder’s story, was reportedly spotted in the prison library earlier this year.

Holmes, who was once likened to Steve Jobs, was Forbes Magazine’s youngest self-made billionaire in 2015.

Theranos, which Holmes founded when she was 19, was once one of Silicon Valley’s most feted startups, valued at more than $9bn at the peak of its success.

The Silicon Valley blood testing company boasted a string of high-profile investors and directors including Rupert Murdoch and Henry Kissinger.

The biotech company promised to deliver revolutionary technology that would detect hundreds of diseases and other ailments from just a few drops of blood, but this proved to be untrue.

A series of reports by the Wall Street Journal exposed how bosses were secretly sending blood tests to traditional laboratories instead of using Theranos’ signature blood-testing machines.

Holmes was sentenced to 11 years in prison for the scandal.

In a separate trial, Sunny Balwani, Theranos co-founder and Holmes’ ex-boyfriend, was sentenced to almost 13 years in jail in 2022. Balwani has already begun his sentence in a prison in Southern California.

Earlier this month, a judge ordered Holmes and her Theranos co-founder to pay Mr Murdoch $125m (£100m) as part of restitution for their crime.

Mr Murdoch, 92, invested a reported $100m in the company between 2014 and 2015 while its valuation and prominence was soaring.

The sum Holmes and Balwani have been told to repay Mr Murdoch is the single largest part of the restitution order.

Lawyers for Holmes and Balwani have previously argued the pair have very little money and it is unclear whether they will ever be able to repay the full $425m.

In her first interview since the scandal broke in 2016, Holmes told the New York Times earlier this year she had been “playing a character I created”.

She said: “I believed it would be how I would be good at business and taken seriously and not taken as a little girl or a girl who didn’t have good technical ideas.”